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ill Street 
the War 



A concise argument against 

"Rich Man's War" 
Propaganda 



Issued by 

Publicity Department 

Commission of Public Safety 

Saint Paul, Minn. 



of 
23 1919 



Wall Street and theWzr 



This war is everybody's war; we are 
all in it. It was made by the Government 
of the United States in behalf of all the 
people. It was not undertaken for the 
benefit of any section or class in the 
nation. It was not begun at the behest 
of any fragment of the people. The 
benefit which will be derived from the 
successful prosecution of this war will 
not go to any class or group. They will 
be shared by all the people, but chiefly 
enjoyed by the poorer classes. The 
burdens of the war will be borne by all 
classes, not chiefly by the poorer. In 
particular it is to be noted that, among 
business men, the makers of munitions 
will not profit greatly from the entry of 
the United States into the war. Rather 
they will be worse off than before that 
event. 

This war was undertaken to crush 
finally the menace of Prussian despotism 
and "to make the world safe for de- 



mocracy." The German Empire rests 
on the might of the Prussian army and 
that army owes obedience not to the 
people nor even to Parliament, but to 
the King alone. 

Speaking to the Prussian Parliament 
some time before the outbreak of the 
present war, Bethmann-Hollweg declared ; 
"The dearest desire of every Prussian is 
to see the King's army remain complete- 
ly under the control of the King and not 
to become the army of Parliament." 

Professor Delbruck of the University 
of Berlin has written thus of the army: 
"The King is their comrade and they are 
attached to him as their war lord, and 
this is the very foundation of our national 
life. The essence of our monarchy resides 
in its relations with the army. Whoever 
knows our officers must know that they 
would never tolerate the government of a 
minister of war issuing from Parliament " 

There are, indeed, Parliaments in 
Prussia and in the German Empire, but 
they are weak bodies, being little more 
than debating societies. German writers 



have called the Reichstag, the most 
powerful assembly in Germany, a "Hall 
of Echoes." Even this body can do 
little except to register its assent or 
disapproval of plans presented to it by 
the Emperor's ministers. These ministers 
can, and on occasion do, defy the repre- 
sentatives of the German people and 
taunt them with their powerlessness to 
oppose the wishes of the Emperor. There 
is no democracy in the German Govern- 
ment, nor any safety for democracy in 
any land while the despotism of Prussia 
exists. This power, resting, upon a large 
structure of militarism which has sacri- 
ficed everything to make the nation 
efficient in war, is the power which has 
attacked the United States. It can be 
resisted only by force of arms, because 
that is the argument to which it has 
appealed. This means that unless this 
war is won by the forces which are 
fighting in defense of democracy, we must 
prepare ourselves to undergo a discipline 
as rigorous and to support a burden as 
heavy as that now borne by the German 
people. A standing army of tremendous 






size, supported by huge expenditures for 
the latest and best equipment, would be 
forced upon this nation as a permanent 
institution, so long as the menace of 
Prussian military power remained. There 
is not only mighty force in Germany, 
but the determination to use that force 
in aggression against the rest of the world. 
The declarations of the Emperor to 
Ambassador Gerard show that Germany 
was planning to strike at the United 
States when she had finished the present 
conflict. Already official German press 
dispatches talk of "the next war" which 
shall give Germany the world dominion 
she so much covets. The chief benefit 
of a victory for the opponents of such 
aggression would be greater safety for 
democracy, which is but another way of 
saying greater freedom and opportunity 
for the common man in every nation. 

This, and other gains from this war 
belongs to the rich man and the poor 
man alike. This war, which secures such 
benefits, is indeed everybody's war. 

The costs of this great struggle are 
tremendous and they are to be borne by 



those to whom the benefits shall come. 
As all the people gain, so all contribute 
of their services and powers to the 
support of the government in its prosecu- 
tion of the war. The Selective Service 

Law has given us a truly democratic 
army into which we have called all our 
young men, without distinction between 
rich and poor. In calling for contribu- 
tions of money, also, the Government has 
not laid upon the poor burdens greater 
than they ought to be called upon to 
bear in this hour of great danger to the 
nation. The charge that this war was 
undertaken at the behest of the rich men 
of the country finds strong refutation in 
the distribution of taxes in all war 
revenue bills passed by the last Congress. 
In this law the heaviest contributions are 
laid upon large incomes and profits from 
great business. A Congress which made 
war upon the order of the wealthy would 
hardly have dared to treat its masters 
so. The taxes which would most directly 
affect the great mass of the people, such 
as those on tea, coffee and sugar were 
not accepted by the lawmakers, though 



urged upon their attention. It cannot, 
however, be argued that the rich man is 
only paying for special advantages he 
will gain from the war. There are no 
gains which will come to the rich in which 
all the people will not share. The ad- 
vantages of living in a world freed from 
the menace of Prussian Militarism are of 
greater value to the poor man than to 
the rich. In a state where there is no 
democracy the advantages of the rich 
man over the poor are greatly increased. 
The security won by this war is valuable 
to all Americans, without respect to 
wealth. In no sense can this be called a 
rich man's war. 

A further burden now being borne by 
the property owners of this country 
arises from the depreciation in the value 
of their investments in stocks and bonds. 
Many of the most reliable issues have 
suffered a serious decline in price. The 
underlying cause is not to be found in the 
activities of speculators and jugglers of 
the stock market. Many factors com- 
bine to produce this result, among which 
should certainly be named the heavy 



taxes which have been found necessary 
in order to support this war. The United 
States Government, further, has come 
into the financial field offering bonds at 
an unusually high rate of interest and 
this has had the effect of making other 
investments less attractive and hence of 
lowering their price. It is idle to argue 
that these losses are only on paper. 
They are real losses in value, since they 
are based on the decreases in the income 
yielded by the securities. Nor can it be 
argued that the rich get a return for the 
burden thus borne, since they gain 
nothing from this war which is not shared 
by everyone in the country, whether 
or not he owns a single bond or share of 
stock. 

In particular it can be shown clearly 
and briefly that the American participa- 
tion in this war does not benefit the 
makers of munitions in any such degree 
as the public has been led to believe. 
The first false impression to be over- 
come is the notion that the making of 
munitions during the present war has 
been uniformly profitable at a fabulous 



rate. The fact is quite the contrary. 

Figures compiled by the United States 
Treasury Department reveal that only 
about half the munition makers of the 
country earned enough to make them 
taxable under the special taxes imposed 
by Congress. These figures relate to the 
period prior to the declaration of war by 
the United States, the time when the 
profits in this particular business were 
at their greatest. Figures produced in 
Congress during the debates on the sub- 
ject of special taxation of profits from 
munition making proved clearly, that, 
while a few concerns had made large 
amounts of money, the general run of 
concerns in this business had not earned 
a rate of profit upon their investments 
equal to that obtained in the field of 
ordinary business. To use a business 
phrase, the making of munitions has been 
a particularly "spotty" sort of enterprise. 
It is notable that one of the concerns 
whose aggregate gains have reached the 
highest figure has actually earned a rate 
of profit less than that prevailing in the 
general run of industrial undertakings. 
Bankruptcy has been the fate of many 



an enterprise in this field. This experi- 
ence, it should be added, has not been 
confined to the United States, but has 
been duplicated in all the belligerent 
countries. Abroad most of the war taxa- 
tion of excess profits was at first aimed 
solely at the munition manufacturers, be- 
cause it was thought that they would be 
most likely to reap unusual gains from 
the war situation. In all these countries 
the event proved this to be a false as- 
sumption, and the taxes have therefore 
been broadened to include other lines of 
enterprise. The fact of the matter is 
that those who reap the greatest gains 
from their nation's participation in war 
are the_ producers of the fundamental raw 
materials upon which the structure of 
industry rests. The list of such pro- 
ducers includes the miner and the farmer, 
but not the maker of shrapnel. 

The entry of the United States into 
the war has, moreover, hurt, rather than 
helped the munition makers. Their taxes 
have been increased, until they now 
bear a burden heavier than that laid 
upon similar industries in Great Britian. 
Though the rate of the American tax is 
lower, the basis upon which excess profits 
are computed in such less favorable to 
the corporations than that used in 
England. In addition to this our muni- 



—KV v, co N G RESS 




tion manufacturers ®*8 465 842 2 
the advantageous market they ionnci v 
enjoyed. Their dealings with our own 
Government are on the basis of fixed 
prices which cut the margin of profit to a 
small figure. As the buying of the Allies 
becomes centralized the possibility of 
getting a higher price from foreign govern- 
ments also disappears. Without mention- 
ing increasing costs due to labor condi- 
tions consequent upon the entry of this 
country into the war the situation of the 
maker of munitions is worse than it was 
before the United States joined the ranks 
of Germany's foes. The munition makers 
were in a position to know these things 
before our Government declared war. 
They can hardly be thought to have 
urged such a step. 

The war cannot be called a "rich man's 
war," for it is everybody's war. The 
benefits to be gained belong to everyone 
in the nation. In particular, it is fallacy 
to hold that the rich man, or any frag- 
ment of them, such as the munition 
makers, urged the war for their own gains. 
They now bear a heavy burden, it is 
true, but they will derive no benefits 
other than those shared by all the people 
when the world shall have been made safe 
for all the people. 



LIBRARY OF CONGRESS 

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